- According to CryptoSlate, the amount of bitcoins leaving exchanges and staying in cold wallets has increased, than the amount of BTC deposited in crypto exchanges.
The price of the assets, whatever it is, is governed by the rule of supply and demand: the more investors want a scarce product, the value of this will rise. Bitcoin has the particularity of being limited, so in more than 100 years the “printing” of BTC will stop.
This is one of the principles that optimists highlight when pointing out that digital gold will experience an upward curve in the coming years: some analysts believe that each unit is likely to reach $500,000 dollars (or more). Today, Bitcoin could be close to starting a new bull run for this very reason…
Bitcoins leave exchanges
According to research conducted by CryptoSlatethe number of withdrawals from centralized exchanges to cold wallets is higher than the number of deposits on exchanges. The account is easy and clear: Binance, Coinbase and Kraken, just to name a few, have less and less BTC to offer.
“This bullish metric shows that investors are planning to hodle the coins they accumulated during the crypto winter (bear market).”highlights the site.
One of the reasons that has influenced this phenomenon was the series of events that occurred last year, which affected the crypto market as it was the disappearance of Terra and the subsequent collapse of FTX, of which the consequences are still being felt. Following this, investors considered safer take refuge in hardware wallets. These are not connected to the Internet and you really own your own coins.
BTC holders with no intention of selling
The users, they typically use exchanges to sell their cryptocurrencies and make digital/physical money. For this reason, that they remove the assets, it means that They are not currently interested in selling. The market sentiment index (Fear & Greed Index) currently registers that the public is neutral: there is no fear (FUD) and no excitement (FOMO).
From 2014 to September 2022, almost a year after BTC peaked, deposits always exceeded withdrawals from exchanges. Until then, exchange houses had more and more to offer. As an example, in September 2022, 53,000 BTC were extracted and “only” 52,000 entered.
Withdrawals in November peaked at 81,000 BTC, while on February 11, 44,000 BTC were deposited on exchanges and 61,000 withdrew. These are coins that go “out of the system” and are held as a safe haven of value.
We are facing a bull run
According to CryptoSlate, comparing exchange-related transactions to the total number of Bitcoin transactions can show if the market is preparing for a bull run.
As an example, at the end of 2017, 400,000 transactions were registered, which began the first great bullish rally of Bitcoin, which ended near $20,000 dollars. Actually in FFebruary the total of 307,000 in Bitcoin was already exceeded, which is the maximum of the last two years.
“About 80% of all Bitcoin transactions at the time were related to exchanges, and the majority were deposits”says the report.
This event has been repeated on several occasions in which the price of BTC increases following the same pattern: an increasing number of transactions fueled a bull run that corrected once the transaction numbers reached their peak. you
The last time we saw this phenomenon was at the beginning of 2021, once the first months of the COVID-19 pandemic had passed.
Even these movements have not had a great impact on the price of Bitcoin, which at the time of writing this article was in the range of $22,250 dollars. In the last week it registered -4%.
Will the crypto winter continue to spread or will crypto be the turn to enjoy the spring?
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